Visa Chargeback Reason Code 13.6: Credit Not Processed

What is Visa Chargeback Reason Code 13.6?

The Visa chargeback reason code 13.6 occurs on chargebacks where the cardholder claimed credit or a voided transaction receipt was not processed. That means the cardholder expected to receive the money within a specific period but did not see it. Hence, the issuer will process the chargeback based on the initial expectation of a refund.

There are several reasons and scenarios where you might have accepted to refund a cardholder. It could be that the merchandise was returned and your return policy was not violated. In that case, the buyer would naturally expect a refund, unless you reached another agreement with them.

Another case would be voiding a transaction receipt of which the cardholder has a copy. Voided receipts should be canceled before the transaction settles on the buyer’s account.

Hence, don’t expect them to wait ages for their refund. Filing chargeback claims with proof of a voided transaction receipt will cause the issuer to process them.

You may have overcharged a transaction and reached an agreement to refund the extra charges. Delays here can cause chargebacks under this code as the cardholder grows impatient.

Miscommunication between you and cardholders regarding returns and refunds will often lead to this chargeback. While we understand that some buyers can grow impatient, merchant error can also be the cause. Hence, you must take adequate steps to minimize or eliminate errors that could lead to chargebacks under this code.

You can fight chargebacks under this code if you believe they were wrongfully processed. We’ll show you how and provide tips to prevent them in your business.

Why Did It Happen?

The primary cause of chargebacks under reason code 13.6 is unprocessed credit. Cardholders will file disputes with their issuers if they expected a credit and did not see it. Hence, chargebacks under this code belong to the consumer disputes category.

A customer who has received the credit transaction has no reason to file disputes that will result in a chargeback under this code. Nevertheless, oversights from cardholders and issuers can result in a chargeback.

Let’s assume you processed the credit, but the cardholder missed it in their account statement and still filed a dispute. The issuer, which should have investigated the claims, also missed your credit. A chargeback will occur.

That could be ignorance on the cardholder's part or something done intentionally to the cardholder’s benefit. The latter would be a case of friendly fraud, which also causes chargebacks.

Besides these, Visa has a few reasons that would qualify for chargebacks under this reason code. They are as follows:

• A credit was promised but not processed: If the cardholder can prove their eligibility for a credit, the issuer will process the chargeback. Things might get expedited if there is an actual promise from you to refund the cardholder.
• A credit was issued but not deposited with your acquirer on time: Issuing a credit is one side of the equation. The credit must be deposited with your acquirer on time to reflect on the cardholder’s next account statement. Failure to do this can result in chargebacks under this code.
• A voided transaction receipt was voided: There are several reasons for canceling a transaction receipt. Voided receipts should not be processed. Processing them will cause most cardholders to file disputes with their issuers and receive chargebacks.

Chargebacks under Visa reason code 13.6 are common with returned merchandise.

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How to Fight Visa Chargeback Reason Code 13.6: Credit Not Processed

Issuers have 120 days to process chargebacks on disputes that involve unprocessed credit. Conversely, you have 30 days to respond and present your case if you believe the chargeback is invalid. Your evidence must be convincing enough to show that you shouldn’t incur the chargeback.

Fortunately, Visa has outlined several approaches to fighting and invalidating chargebacks under this reason code successfully. They are as follows:

• If your sale is valid and the cardholder is not entitled to a refund or credit: Provide documentation to refute the cardholder’s claims or documents. Your return policy could sometimes prove that the cardholder is not entitled to a credit. Bring these documents and ensure they show the buyer’s acceptance during the purchase.
• If the disputed amount involves a cash back portion: Provide documents to show that the disputed amount involved the cashback portion of the purchase. That will invalidate the chargeback, as it does not include the actual transaction.
• If you have processed the credit: Provide documentation with the date and amount processed. If the date on your document is before the chargeback date, the issuer will process a refund for you.
• If the cardholder no longer disputes the unprocessed credit: Provide evidence if you’ve reached an agreement with the cardholder and the dispute has been withdrawn. You should obtain written statements (emails are okay) to validate your claims.

Automatic fuel dispensers are tricky to deal with. Chargebacks from them are often fraudulent, where customers fraudulently request chargebacks. You could invalidate chargeback claims if they come from your automatic fuel dispensers.

The US EMV Liability Shift Rules for Counterfeit Fraud make correctly processed contact chip-enabled terminal transactions ineligible for chargebacks.

How to Prevent Visa Chargeback Reason Code 13.6: Credit Not Processed

Chargebacks are not good for business, especially those that arise from the customers’ oversights. You should close as many loopholes as possible that could lead to these oversights. Also, you should eliminate mistakes that cause chargebacks under this code.

The following approaches can help prevent chargebacks under reason code 13.6:

• Process pending credits promptly and submit them immediately to your acquirer. That ensures they appear on the cardholder’s next account statement, reducing the chances of a dispute.
• Use clear and easily recognizable merchant descriptions in your credit statements. That will prevent oversights where cardholders cannot tell they’ve received your credit. They might know you by another name, while your merchant description uses a short form that isn’t recognizable.
• Train your staff to withdraw all voided transaction receipts immediately. Also, ensure voided transaction receipts get to the proper channels for quick cancellation.
• Inform your customers of any anticipated delays in credit processing.

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